A few days ago, Paul
Krugman from The New York Times made an important
observation that affects the U.S. economy as well as other mature
economies throughout the world. It's the Year of The Tiger in China,
and it seems that it's gone to their head. Last month and since 2004 I
have reiterated the national security issues with China's escalating
cyber-espionage aimed at the United States, their
continual industrial espionage and over three-thousand Chinese
"front-companies" that operate in the United States with the sole intent
of siphoning-off American know-how and technology. In spite of
knowing how China treats their own people, which isn't properly
documented and televised, and their continual military/industrial
espionage most American and multi-national corporations continue to do
business with a country that violates every concept of decency and
humane treatment that is the great dividing factor between East and
West. To the western World, life has some value, but in China, power,
authority, and achieving their goals trumps any vestiges of humanity
that most Westerner's take for granted and they often turn a blind eye
to their own citizenry on issues that if they occurred in any western
country would immediately result in shutting a corporation down or
fining them out of existence. When China's industry sickens their own
people, they actually punish the people seeking medical attention and
turn a blind-eye to the perpetrator of the crime(s) and American,
multi-national, and Chinese corporations reap extremely high profits
from human suffering and the poisoning of entire communities.

Tensions are rising over Chinese economic policy, and rightly so:
China's policy of keeping its currency, the renminbi, undervalued has
become a significant drag on global economic recovery. Something must be
done.

To give you a sense of the problem: Widespread complaints that China
was manipulating its currency -- selling renminbi and buying foreign
currencies, so as to keep the renminbi weak and China's exports
artificially competitive -- began around 2003. At that point China was
adding about $10 billion a month to its reserves, and in 2003 it ran an
overall surplus on its current account -- a broad measure of the trade
balance -- of $46 billion.

Today, China is adding more than $30 billion a month to its $2.4
trillion hoard of reserves. The International Monetary Fund expects
China to have a 2010 current surplus of more than $450 billion -- 10
times the 2003 figure. This is the most distortionary exchange rate
policy any major nation has ever followed.

And it's a policy that seriously damages the rest of the world. Most
of the world's large economies are stuck in a liquidity trap -- deeply
depressed, but unable to generate a recovery by cutting interest rates
because the relevant rates are already near zero. China, by engineering
an unwarranted trade surplus, is in effect imposing an anti-stimulus
on these economies, which they can't offset. MUCH
MORE

As noted above, it is not only the United States that is bearing the
brunt of China's continuing currency manipulation, but economies
throughout the world. Paul Krugman is not the first to
point out this disparagement, nor will he be the last; several well
known economists have written about China and how undervaluing their
currency is affecting economies on a global basis:

WASHINGTON -- President Barack Obama faced growing
congressional pressure on Monday to get tough with China over its
currency practices, one day after Chinese Premier Wen Jiabao brushed off
accusations that Beijing was undervaluing its currency for an unfair
trade advantage.

"The impact of China's currency manipulation on the U.S. economy
cannot be overstated. Maintaining its currency at a devalued exchange
rate provides a subsidy to Chinese companies and unfairly disadvantages
foreign competitors," 130 lawmakers said in a letter to U.S. Secretary
Timothy Geithner and Commerce Secretary Gary Locke.

Many economists estimate China's currency is undervalued by 25% to
40%, giving it a huge trade advantage by effectively subsidizing its
exports and taxing its imports. LINK

In the last few years we have witnessed a constant barrage of unsafe
products and even food items that have been manufactured in China that
have caused, and have/had the potential to cause pain and suffering to
our children and even the death of our pets in the United States.
Chinese industrialists have not targeted the United States in
particular, and greedy companies operating in China have harmed their
own citizens as well as those throughout the global community. In
November of 2009, many people should remember this story, but Chinese
"justice," if there is such a thing, apparently is lopsided and it
depends on "who" is harmed whether or not the leaders in China choose to
prosecute individual companies that cause harm to their own citizens:

China executes two over tainted milk powder scandal

China has executed two people for their role in a
scandal involving tainted milk powder that resulted in six children
dying, officials have said.

More than 300,000 other infants were made ill from milk powder
contaminated with melamine, an industrial chemical used to make
plastics and fertilizer.

Zhang Yujun and Geng Jinping are the only people to have been
executed over the scandal, court officials said.

I am nothing more than a patriotic American that is doing whatever I can to further the cause of democracy, the rule of law, and am extremely concerned in regard the slow creep of "soft fascism" that has been destroying America's middle-class.
I (more...)